by Sarah Royce-Greensill, The Telegraph, June 14, 2017
Money can’t buy you happiness, the saying goes - but that depends on what you’re spending it on. Psychological research suggests that people who spend their money on experiences rather than material goods feel happier, and that the money was better spent. The feeling of anticipation leading up to an experience and the memories it evokes create a longer lasting sense of fulfilment than a shiny new possession, of which we soon tire.
It’s an ethos that has certainly hit home with millennials, who are driving this so-called experience economy. According to a study by Harris Group, 78 per cent of this demographic, who came of age during the recession, would prefer to spend their money on experiences than material goods; their sense of self-worth comes from doing, not having. Social media is a driving factor - while it seems crass to Instagram a picture of your new designer shoes, an artful shot of an exotic holiday or intimate gig will garner likes in their droves.
And it’s not just the younger generation. In these turbulent times, Ultra High Net Worth Individuals seek out discreet markers of wealth rather than the heavily branded status symbols of the noughties. Scarcity and exclusivity are valued over ostentatious displays.
According to the 2017 Wealth-X Billionaire Index, the experiential luxury sector consistently outperforms any other sector of luxury goods. UHNWIs want luxury experiences that no-one else has: these unique, once-in-a-lifetime experiences - along with the associated bragging rights - are what counts, so long as they have the time and privacy to savour them.
All of which explains why private members’ clubs and societies go above and beyond to offer their members things that money can’t buy. American Express has form in this field: having set up the first Platinum Card membership programme in 1984, in 1991 it launched its By Invitation Only programme, designed to provide experiences that its members would never be able to arrange themselves, no matter what the figure in their bank account.
These experiences encompass the worlds of sport, entertainment, dining and fashion - all of which come with some form of travel as a given. There’s a calendar of 80-100 events per year across the globe and in each case the company draws on its insider access to arrange experiences that money can’t buy.
A recent programme saw AMEX partner with Harper’s Bazaar as the magazine celebrated the launch of its 150 Years: The Greatest Moments coffee-table book. AMEX enlisted Harper’s Bazaar US editor-in-chief Glenda Bailey to arrange three successive events in London, Paris and Milan, giving fashion-loving members the sort of access to designers that’s usually reserved for top-tier editors.
In London, this meant an intimate cocktail gathering at Victoria Beckham’s Mount Street store; in Paris, Christian Louboutin lovers congregated in the coffee shop where the designer buys his morning cappuccino; and in Milan Giorgio Armani hosted cardmembers at his Via Montenapoleone boutique.
Bailey also pulled a few strings to arrange an extra perk for the group in Paris: a private tour of the Schiaparelli atelier on Place Vendôme, where creative director Bertrand Guyon gave an insight into the brand and the refurbishment of the historic townhouse, whose spectacular interiors are usually only seen by a minute number of haute couture clients. Naturally, the opportunities for sharing on social media were immense.
“I know what it feels like for me to be on the front row of fashion shows, but for cardmembers to have the opportunity to do something that very few people usually can is very special,” said Bailey in Paris. “Nowadays luxury isn’t just about wanting more and more material goods; it's about being part of something, being in a group, being able to all collectively enjoy an experience. I think that's what we’ve really found here today. Everybody was just enjoying that unique opportunity.”
The Instagram-factor has played a significant role in the development of the By Invitation Only program over the last few years, says Janey Whiteside, senior vice president and general manager of Global Charge Products, Benefits and Services at American Express.
“I think social media plays a really interesting role in this experiential economy and the idea that experience is the new luxury,” she says. “We live in a world where it didn’t happen unless it’s on Instagram: people really want to be able to share their experiences. We find ourselves increasingly thinking about curating experiences that not only make a mark on those who can attend, but translate well onto social media. We like to create shareable moments: things that are highly visual, and we encourage people to snap a photo, share it with their friends, hashtag it. It creates a really interesting 360-degree view of what’s going on.”
Luckily for the brands that get it right, the desire for experiences needn’t come at the expense of buying material goods. Allowing consumers access and creating memorable experiences naturally drives brand loyalty: as shown by the flurry in spending at each of the fashion-focused By Invitation Only events. “Most of the people who sign up are brand advocates in the first place but now they’ll be absolutely brand loyal moving forward,” says Whiteside, who, like Bailey, cites Victoria Beckham and Gucci as two brands who successfully use social media to connect with their customers and build a sense of community.
This feeling of belonging drives people to purchase. According to Knight Frank’s 2017 Wealth Report, a key reason given for investing in a luxury item - after personal enjoyment, capital appreciation and status - was “becoming part of a like-minded community”.
For AMEX these like-minded communities spring up across the globe: from an outpost of the world’s best restaurant, Eleven Madison Park, in the Hamptons - to which Platinum Cardholders will have exclusive access - to prime Centre Court seats at the Wimbledon finals; or a private dinner at Kensington Palace and viewing of the Diana: Her Fashion Story exhibition. Whatever the event, one thing is for sure - social sharing and spending will go hand in hand.